(EnergyAsia, September 8 2014, Monday) — With its refineries operating at record levels, the US has become a major exporter of oil products with first-half sales hitting a new high of 3.7 million b/d, said the US Energy Information Administration (EIA).
Boosted by cheap domestic crude feedstock, the expansion of refining capacity together with pipeline and storage infrastructure has enabled US product exports to take off from just one million b/d in 2004. With its strategic location, the Gulf Coast (PADD 3) has benefitted most from the world’s rising oil demand to account for 72% of the nation’s export of gasoline, jet fuel, petroleum coke and gas liquids.
“Gulf Coast refineries remain extremely competitive in the global market because of access to cost-advantaged inputs, significant upgrading capacity, and proximity to significant demand centres,” said the EIA.
About 90% of PADD3’s gasoline exports are delivered to the Western Hemisphere with occasional cargoes shipped to Africa and Asia while half of its mid-distillate production is exported into the Atlantic Basin market and the rest to Central America and South America, Europe and Mexico.
The recent shift of the West Coast (PADD 5) from net importer status to net exporter has also boosted the US profile as an oil products supplier, said the EIA.
“Increasing domestic crude production has allowed Rocky Mountain and inland PADD 3 refineries, such as those in Utah and West Texas, to increase utilisation and to supply petroleum to states such as Nevada and Arizona that were previously supplied by refineries in California,” it said.
Offsetting the surpluses in the Gulf and West Coasts, PADDs 1A and 1B in the northeast continue to rely on imports to meet demand.
The EIA reported that US refinery inputs hit a record-high 16.8 million b/d for the week ending July 11, eclipsing the previous record from summer 2005 and more than 280,000 b/d higher than a year ago. US refiners have been operating at well over 90% of their 17.8-million b/d nameplate capacity in recent months. PADD 3 has led the charge with throughputs rising to a record 8.7 million b/d in early July.
“The US remains an increasingly active participant in the global petroleum products trade. The Gulf Coast region’s competitive advantage based on heavy upgrading capacity, cost-advantaged input and fuel costs, and access to growing markets keeps utilisation rates high,” said the US agency.
Earlier, the International Energy Agency predicted that North America, led by the US, could supply as much as 20% of the world’s oil products by the end of the decade. In a sharp reversal of its position as a net importer, the US is becoming a “titan” supplier of oil products.